The Cellular Operators Association of India (COAI) has expressed disappointment over the Union Budget proposals for 2015-16 stating that it does not address the requirements of the Indian telecom sector.

“While a few proposals in the Union Budget may help growth of telecom and broadband, overall, the industry’s concerns and submissions have been left unanswered. With the government’s thrust on the Digital India initiative, a more supportive budget was expected for the telecom sector,” said Rajan Mathews, Director General, COAI.

According to COAI, the positives from the budget were the proposals linking the Jan Dhan programme, Aadhaar Cards and mobile telephony. Further, the association stated that the step would recognise and encourage the role of mobile telephony towards facilitating financial inclusion and will enable well targeted cashless transfers, which would, in turn, help in the uptake of mobile payment services.

COAI is of the view that the reduction of corporate tax from 30 per cent to 25 per cent with removal of exemptions over the next four years will only result in marginal benefits. However, the increase in service tax from 12.36 per cent to 14 per cent will have a negative impact as it will affect the consumers and make the services more expensive.

Meanwhile, it added that the goods and services tax, being rolled out by 1st April 2016, will increase the cost of telecom service. However, no such issue has been addressed in the budget proposals.